Luxner News Inc, Stock Photos of Latin America & the Caribbean
 

Article Search

Cameroon Hopes to Propel Its Economy Pushing Ports, Infrastructure Projects
The Washington Diplomat / September 2010

By Larry Luxner

By 2015, Cameroon could boast the busiest port in Central Africa, if an ambitious scheme to transform the palm-fringed beach resort of Kribi goes according to plan.

The Kribi seaport construction project — valued at 400 billion Central African francs (around $750 million) — is aimed at relieving overcrowding in Douala, the nation’s commercial capital and home to its main shipping port. It’s also one of many efforts by President Paul Biya, who’s ruled Cameroon since 1982, to alleviate poverty, create jobs and lure foreign investment to this long-neglected country of 20 million.

Project manager Louis Banack conceded that the sleepy fishing village of Kribi (population 60,000) would be forever changed by the massive port. Yet he said this project is absolutely crucial to the Cameroonian economy.

“Cameroon wants to develop its economy based on minerals, mainly iron ore and bauxite,” said Banack, interviewed at a seaside restaurant overlooking the Gulf of Guinea, some 35 kilometers north of where the new complex will rise.

“The port of Douala handles seven million tons of cargo per year. But Douala has a problem: the depth of the channel is not enough for big ships,” he told The Washington Diplomat. “The fact that Douala cannot allow these bigger ships to anchor prevents us from developing our industries. This is a handicap for our economy. We have minerals we cannot export because of this.”

Douala’s port covers 400 hectares and has 11 cargo berths, of which nine are for general cargo. It also has a large timber terminal with 280,000 square meters of stacking space, and is dredged to a depth of seven meters.

By contrast, Kribi will be dredged to 15 meters, with some specialized mineral and iron-ore terminals dredged to 24 meters. This will allow ships measuring up to 300 meters in length to dock.

Banack said construction will take five years, with the first ship likely to anchor by 2013. The terminal will be managed by private partners via concession, though it will always remain the property of the state.

When fully operational, Kribi will be handling 70 million tons of cargo annually — 10 times as much as Douala’s current capacity. Mining giants Rio Tinto and Alcan plan build an aluminum smelter within the port complex, with planned output of 400,000 tons of aluminum a year in the beginning, rising to one million tons a year later on.

Also envisioned is a facility for the export of liquefied natural gas (LNG) to the United States, as well as a sawmill for processing Cameroon’s famous hardwoods, mainly for shipping to China and other Asian markets.

Awa Fonka Augustine, a local official in Limbe, further up the coast close to the Nigerian border, says the project has created a lot of excitement in the coastal region.

“Wherever there’s a port, even if you don’t have much to export, just the fact that some ships will stop will create economic activity,” Augustine told us. “It will change the life of the area.”

Limbe is home to around 85,000 people and several beach resorts catering to European tourists. It’s also the headquarters of the Cameroon Development Corp. — which owns vast banana and rubber plantations — and could soon have its own port, though that project seems less advanced than the one in Kribi.

A feasibility study recently released by the Limbe Port Development Corp. and its South Korean partners concluded that $852 million would be required to build a deepwater port at Limbe.

The study shows a projected cargo traffic of five million tons of cargo and 200,000 containers by 2012. The Limbe port, if built, would handle cement manufactured at a new plant built by Korean interests. As envisioned, Limbe would have four areas of commercial and industrial activities, as well as a container terminal and the export of oil through the state-run National Society of Refining (SONAR).

“We must develop industries in which we are already strong,” said Louis-Paul Motaze, Cameroon’s minister of economy, planning and regional development. “For example, wood is now exported as logs, not as manufactured products. We must transform wood into added value. That’s one example; another is cotton. We have cotton, but we’re doing nothing with it.”

Mary Barton-Dock, World Bank country director for Cameroon and six other Central African countries, said one of Cameroon’s biggest problems is the lack of adequate infrastructure — particularly transportation and energy.

“The bad news for Cameroon is that they still do very poorly in the investment climate ranking we put out every year,” she told The Diplomat. “One of the really tough challenges is the cost of electricity. So we’re working on increasing the availability of electricity in the hopes prices will go down. Cameroon is basically a country with an emerging mining sector. They have some potential to build agribusiness, and they have tourism potential. So we’re working with the government in investing in all those sectors to try to get things going.”

In 2009, U.S. exports to Cameroon came to $154 million, while U.S. imports from Cameroon reached nearly $250 million. In 2008, total foreign direct investment in Cameroon hit a record $231 million, up from $71 million the year before.

The largest single foreign investment here is the Chad-Cameroon pipeline — a controversial, 1,070-kilometer-long project to bring petroleum from the oilfields of southern Chad to the Cameroonian coast near Limbe. It was launched in October 2000 — with hundreds of millions of dollars in funding from the World Bank’s International Finance Corp. — and is operated by Exxon-Mobil. But the pipeline has been plagued by allegations of corruption and diversion of revenues from the very beginning.

Motaze, the economy minister, admits that the government’s past policies of getting loans from the World Bank and spending the funds on social needs were totally ineffective.

“We got a lot of money and used it to build schools and hospitals, but after that we discovered that our rate of growth was still very low,” said Motaze, who happens to be a nephew of President Biya. “Everybody knows the importance of health and education, but those sectors do not create wealth. You cannot do anything if you have lack energy, roads or ports. So our new strategy is to create wealth by giving money to the private sector. That’s the only way to bring people out of poverty.”

Luxner News Inc, PO Box 938521 - Margate, FL 33093 USA tel=301.365.1745 fax=301.365.1829 email=larry@luxner.com web site design washington dc